Though negotiators have avoided putting an official figure on the financial settlement in the joint text agreed last night, British officials in Brussels close to the discussions say the methodology should produce a net bill of under £40 billion.
Downing Street also gave the nod to the calculations on Friday morning – though hardline eurosceptics such as Nigel Farage described the figure as “humiliating” and “way more than we need to pay”.
The figure is net rather than gross – in that it subtracts the smaller amount of money the EU owes from the larger amount of money Britain owes the bloc.
Under the plan, the UK is expected to pay somewhere between €17 billion and €18 billion into the 2019 ‘multi annual financial framework’ (MFF) – effectively the EU's budget round.
It will also pay between €21 and €23 billion into the so-called “RAL” outstanding at the end of 2020 – effectively a credit facility for the EU whose acronym come from the French term “reste à liquider”.
Officials also expect the UK to pay between €2 to €4 billion for actual liabilities Britain owes the EU – mostly things like the future pensions of European civil servants.
But the EU also owes Britain its stake of the European Investment Bank’s capital, which is around €40 and €45 billion, and will pay that back to the UK over the long term.
The joint text agreed early on Friday morning has scant detail about the payment schedule, but is clear that the UK won’t have to make any advance payments it wouldn’t be making in the EU.
“Payments arising from the financial settlement will become due as if the UK had remained a Member State. In particular, the UK will not be required to incur expenditures earlier than would be the case had it remained a Member State unless agreed by both sides,” the joint text says.
“It may be appropriate for the UK and the Union to agree on a simplified procedure for settling some elements of the payment schedule in the second phase of negotiations. Such a procedure should be based on an agreed forecast and, where appropriate, provision for subsequent review and correction.”